Montana Lawmakers Reject Bill That Would Have Allowed State to Invest in Bitcoin

House Bill 429, which sought to allow the state to invest in Bitcoin, precious metals, and stablecoins, was struck down in a 41-59 vote.

A bill that would have authorized Montana to invest a portion of its surplus funds in Bitcoin, precious metals, and stablecoins was voted down by the state House of Representatives on Feb. 22.

The legislation, House Bill 429, would have permitted the State Treasurer to invest up to 5% of the state's surplus in cryptocurrencies and precious metals, while also allowing the state to accept crypto for payments, licenses, and taxes.

However, the bill was ultimately struck down in a 41-59 vote, with lawmakers expressing concerns over the risks of using taxpayer money for such investments.

After passing Montana's Business and Labor Committee on Feb. 19 with a 12-8 vote, the bill faced further amendments on the House floor.

One amendment proposed to fund the bill with interest earned from the American Rescue Plan Act, but it failed to sway the majority.

Of the 40 Republicans who voted on the bill, the majority (40) supported it, while 18 voted against it. Meanwhile, all 19 Democrats who voted opposed the bill.

According to Representative Lee Demming, the bill would have helped the state get better returns on taxpayer money. Speaking during the Feb. 22 House Floor session, Demming argued that if the state was going to hold onto taxpayer money, it had an obligation to ensure the highest possible return on investment.

“Either that or you give it right back to them,” Demming said, explaining his support for the bill.

Montana Representative Steve Fitzpatrick agreed, adding that the state had a surplus of funds “in the bank,” which could be invested in assets like Bitcoin, precious metals, and stablecoins to generate better returns.

Fitzpatrick further highlighted the state's strong fiscal health, with a record high in the budget reserve and a AAA bond rating from all three major credit agencies.

“We have an obligation to get the highest return possible on those funds, within reason,” Fitzpatrick said.

However, those opposing House Bill 429 argued that the bill posed too much risk for taxpayers. Among them, State Representative Steven Kelly pointed out that lawmakers were responsible for protecting public funds and that investments in volatile assets like cryptocurrencies were “way too risky” for state money.

“We are fiduciaries of the people's money. We have to protect it,” Kelly said.

Another opposer called it a “foolhardy way to think about taxpayer dollars.”

Montana joins Wyoming, North Dakota, and Pennsylvania as the only four U.S. states that have rejected similar bills, according to data from Bitcoin Reserve Monitor.

As of Feb. 24, 19 other states are reviewing crypto reserve legislation, with Utah and Arizona leading— both having advanced their bills to their respective Senate floors for further debate.